Thursday, January 29, 2009

Transparency in Gov. Finance and Taxation of Special Districts

Well today two of the more anticipated bills for local government were drafted and numbered.

First, we have SB18 First Substitute Transparency in Government Finance . While the first bill SB18 was out much earlier, the substitute, which addressed many of our concerns was made available for public dissemination.

Here are a few concerns that were expressed as well as the response outlined in SB18 First Substitute.

1. We raised an issue with the ability of small jurisdictions to comply with transparency requirements. In response, Sen. Niederhauser has provided a special exception for jurisdictions with a budget less than $10 Million dollars, which allows for special consideration of their financial capacity and technical capabilities.

2. We raised a concern regarding the timing of implementation. Sen. Niederhauser has subsequently delayed implementation of the legislation's effect until May 2011 for municipal governments.

3. We raised concerns regarding the volume and complexity of information that would be required by the proposed compliance. Sen. Niederhauser has responded by taking the rule making authority away from the State Department of Finance and giving it to the Transparency Advisory Board, of which we will be members as a result of this legislation.

4. We raised concerns regarding a requirement to submit information in a format similar to the state's website format. In response. Sen. Niederhauser has allowed for us to simply comply by linking our existing websites to the state website to allow for a unique format for each city.

5. We raised concerns regarding potential liability for disclosing protected records inadvertently. To address this concern, a liability waiver was included in the substitute.

As you can see, with every question and concern, Sen. Niederhauser has been extremely willing to work with us on the issue. While I believe that most of our membership still has some anxiousness about the unintended consequences, we cannot diminish Sen. Niederhauser's willingness to work with us to address our concerns.

While we are yet to hold a legislative policy meeting to formalize our position on the bill, the ULCT staff will be recommending that our membership support the bill as a healthy compromise that both addresses our major concerns while still accomplishing the objectives put forth by Sen. Niederhauser. We will be recommending that we all work closely with the Transparency Advisory Board and Sen. Niederhauser to work out the specifics.

The second bill that was brought forward today was SB135 Local District Taxing Authority, Senator Bramble. As drafted this bill would preclude a special district from levying a property tax unless the board met one of the following three criteria. (1) The Board of the district was made up of independently elected officials; (2) The participating local entities imposed the tax on the districts behalf; (3) Took the property tax levy to a vote of the people.

Because many cities and towns have raised concerns about the impact that this legislation may have on small water and sewer districts, we will be working to ensure that such districts are exempted from the legislation, as the bill is targeted toward much larger, complex districts. In discussions with Sen. Bramble, he is willing to address our concerns and has asked us to work with him on drafting amendments to the bill. Amendments are in the process of being drafted and should be available next week.

We are pleased with the level of cooperation that has been demonstrated by Sen. Bramble and feel confident that our concerns can and will be addressed.

Please look for further updates in future posts.

We hope this finds you well and until next time .... Enjoy!!!